I’m not talking about the few months after the wealthy have tooled up to send this grand new technology to the third world. I am talking about the first month or two when they stop buying oil and natural gas.
No, it assumes the truth: that all Human Beings, rich & poor alike, are bastards, deep down.
Look at the political history of the 20th Century, for pity’s sake!!! Priviliged tyrants are monsters. Amateur tyrants, who grew up in poverty, are monsters, too.
Ditto for business & finance.
oil != energy.
gas cars would still be around until battery technology improves. for that matter, as would planes, space shuttles, etc. the only transportation that would benefit would probably be trains and next-gen ships/subs.
the power most people get from their sockets comes from coal, then nuclear, and natural gas. our heating bills would plummet and a lot of power station workers would have to be retrained to operate this newfangled power plant but this massive unemployment talk is nonsense.
and if this generator actually costs $1000, then it would be essentially free. an eternal power supply for 1/5 the cost of a 2nd hand civic? and people say it’s “too expensive” ?? i know i’d invest in a company that loaned out these things to 3rd world countries, and i think there would be about 1000 other hedge fund managers that would do the same.
this wunder-power would bring about an industrial revolution that would make the steam engine look like a wind up toy.
Not to mention that in the US at least, power plants are having a hard time finding new employees, and due to an alternating crunch cycle of hiring freezes, there are far, far fewer younger employees at power plants now than when I started in the business. One utility which runs about 10 power plants out west (no, I’m not telling the name) showed me that of their core power plant personnel, at least 20% of them were eligible for retirement within 5 years, and this went up to 50% within 15 years. Their mean age of core personnel was about 38-40.
One might ask why engineers don’t want to work at power plants nowadays, and to some extent you can blame Al Gore. When I speak to Engineering seniors about the power industry, many of them are convinced that the Obama/Gore junta is just months away from shutting down all coal power plants in the US (when I ask them how that will happen with coal power providing 50-55% of our electricity and more than that of our baseload frequency-stabilizing power, they draw a blank or throw out “Wind! Solar! Green power!” They might as well scream “Tractors! Turnips! Buttocks!”).
Essentially free for the richest people in the world, you know the ones who can afford a second hand Honda Civic. For the vast majority of the planet for whom $ 1000 is a year’s salary or more it would be prohibitively expensive.
As for oil != energy, yes it does. It’s one source of energy. Also you have to specify the limitations on this technology, if it produces enough to drive a car then battery tech is irrelevant. But also, we’re talking about making coal, nuclear and natural gas obsolete also, not just oil.
The OP didn’t say how big the magic power source was, which of course determines whether it can replace a combustion engine in a particular application. If it’s, say, a hundred feet across at the smallest then you are right. If it can be made a few inches across it would even replace leaf blower motors. Given that the intent was clearly to postulate an ideal energy source I’m operating on the assumption it can be made very small.
Yes and no.
If you have some energy source that is nearly free to use, even something simple like a magically very hot never ending rock…
Then you can make synthetic “fossil” fuels on the cheap for situations where current battery technology aint going to cut it.
Even if such a device would make obsolete 90% of the work people do, why would this necessarily mean 90% unemployment? It could just as easily mean that the employment rate stays the same, but the standard work week gets cut down to four hours. Honestly, people don’t worry about not having a job; they worry about not getting paid.
OK, in the short run, there would be a jump in unemployment. I’ll grant that; it would take the economy some time to adjust. But even there, this magical new technology would itself go a long way to ease the transition. If I can produce energy almost for free, then I can do things like build indoor hydroponic farms and produce food almost for free, too. And of course I can heat my home cheaply in winter, too. And if I’m getting my food and heating for almost free, then that means that unemployment is going to hurt me a lot less than it would in our current economy. I could certainly weather the transition period long enough from my savings to get to the utopia on the other side, and with a very small amount of government involvement (small because the necessities of life are now cheaper), everyone could be brought through the transition.
Yes. Or non carbon based fuels like hydrogen. The biggest problem with synthetic fuels is that we have to make them; we can’t just pump them from the ground, so they are a net energy loss. They are a form of energy storage, not a source. With magic energy to manufacture them with that’s not a problem.
Price shocks are nothing new in economics. I don’t know why you’re all inventing these wacky scenarios where suddenly everyone is out of work and the rich have everything. Or rather, I do. I think these hypothetical discussions are always seen through the ideological filters of those playing the ‘what if’ game.
But these things have happened many times in history. In 1986, the price of oil was 1/5 of what it was in 1980, in inflation-adjusted terms. It dropped almost in half in one year between 1985 and 1986. There were no breadlines. Millions of people were not thrown out of work.
In the larger history, many key commodities have plummeted in price. Metals, food, spices, computers… None of those shocks led to massive unemployment.
How come? Because the economy reacts much more rapidly to these changes than you’d think. When the price of some good falls, it creates as many opportunities as it destroys. More, actually, because the economy is now more efficient and more can be done.
For decades I’ve been hearing these arguments about automation and free energy and other big changes that are supposed to invalidate the need for labor and throw everyone out of work. I’ve had this identical discussion with classmates in college - in 1985. Back then, robots and automation were going to put half the people out of work and lead to a new world where those who controlled the robots owned everything and the workers starved. It didn’t happen, despite the fact that there’s been a huge increase in the use of automation since then.
Computing power was supposed to do the same thing. All the millions of secretaries, accountants, librarians, print shop employees, and others replaced by the computer were going to become a standing army of unemployable people. But even though computing advanced faster than any of the people making this argument imagined, their dire scenarios never came to pass. It turns out that people can be retrained, and that the increase in wealth that comes from being able to do so much with computers created whole new industries. And it happened fast enough that there never was a big spike in the unemployment rate due to computers.
I see absolutely nothing about free energy that would change this.
The problem as I am seeing it is even if the adjustment period is six months that’s long enough for people to starve and start shooting each other. That’s the thing.
You’re also assuming that people would want to subsidize those who cannot afford the technology, and maybe they would. If it made energy so cheap, then why wouldn’t we just use it to manufacture things in the US? Why order goods from say China?
I think your idea of ‘cheap’ is skewed, because ‘cheap’ is relative. Your wages are part of the expense of something, if something can be made cheaper then why would anyone pay YOU more? If they can get something that would have taken 12 hours before in 30 minutes then they can pay you for much fewer hours. What if this energy helps manufacturing processes but does little for the price of food? Your wages have depressed significantly but the price of food hasn’t.
Price shocks of the scale we are talking about have never occurred in history anywhere ever. You are dismissing things as ideological even though you are completely ignoring the argument being made. You’re showing YOUR hand. Your interest is ideological. And when I say rich I am including you and me in that category.
No they haven’t, they have never occurred in history ever. There has never been anything remotely like the obsolescence of all current forms of energy fuels.
We’re not talking about plummeting in price, we’re talking about being unecessary.
Your entire argument is beside the point. You’re not even addressing the concerns here.
Because it happens incrementally and we have time to retrain people. Of course I have now said this to you close to half a dozen times and you have yet to respond to it.
I await your actually responding to the argument I’m making rather than bringing up all kinds of irrelevant nonsense.
My argument regards scale and time-frame. You haven’t addressed these issues yet.
Of course not because you aren’t even responding to the arguments you’re pretending to respond to.
No, we’re talking about plummeting in price. Energy would still be needed; we’d just be getting it really cheaply.
And what if it lowers the cost of pink unicorns? There’s just no way that cheap energy could not result in cheap food.
While there would be adjustment, I’m not sure there’d be a jump in unemployment, for two reasons:
-
It’s not like we don’t still need oil. Even if your free energy technology was available everywhere in a week, oil is enormously valuable for many other applications. The oil extraction industry wouldn’t vanish. Indeed, oil’s other applications would be used even more, because more oil would be handy AND the energy needed to convert it into other products is now free.
-
I really think people are underestimating the industries that would EXPLODE in size due to free energy. We’d likely be talking about thousands and thousands of jobs being created every week. The want ads would be bursting at the seams for people to join startup industries that would suddenly be viable. Shit, the desalinization industry alone would be busing the labour in - and not just engineers, but accountants, HR people, janitors, construction, painters. Multiply that by a thousand.
You’d also see a shift in demand; the money homeowners wouldn’t be spending on power and gas for their homes would likely be spent elsewhere, raising demand for other goods and thus creating jobs in those industries.
Indeed, I think the result of free energy would be a serious labour SHORTAGE. Wages would go up. A lot.
While there would be downsides to the oil, coal and gas industries, they’d be miniscule as compared to the upsides, and the upsides would happen very fast.
I’m going to go against the grain and argue in the short term not actually a whole lot would happen. The foremost cost for most companies is labor, followed by materials, with energy being fairly far behind. (Of course, the cost materials would also decrease, but even the cost of most materials is predominantly labor.) If you set all those energy costs at each level of production to zero, it would ultimately be a real, noticeable improvement in our social wellbeing, but more on the order of a decade of economic progress than a century.
You would not see mass unemployment; you still need farmers to grow wheat that other workers will turn into buns that truckers will transport to McDonald’s run by service employees who sell it to you. You’d end up saving a couple dimes or so on a Big Mac.
Workers who extract oil or mine coal, and engineers working at plants making electricity from natural gas, would indeed be out of work. But as energy becomes cheaper, more jobs would become available as people have portions of their revenue streams freed up, leaving them with more money that they’d want to invest to make even more money. (These could either be current investment opportunities that simply aren’t being used, or new ones that are created and immediately available using existing technology, such as building batteries or retrofitting gas stations to deal with the new fleets of electric cars flying off the sales lots.)
In the medium and long run, however, you’ll start to see more substantial changes. With energy becoming much more available, people will redirect their research and development efforts toward fields that were previously considered unlikely to yield much profit because of high energy cost. It’s hard to guess before what those efforts might yield, but you could reasonably expect space flight to become much more economical.
States like Texas and Norway would be relatively worse off, compared to similar areas, but I expect they would end up benefiting from such a transition. The Middle East would be pretty farked, since its entire economic structure relies on extracting oil rents. But what else is new?
I was trying to consider a small business or industry that can be stifled by the prohibitive cost of the needed electricity right now, but all I could think of was an illegal growing operation.
Or maybe a LAN gaming center. Do those exist anymore?
Desalinization requires massive amounts of electricity, as mentioned above. If we had enough water, we could make the deserts bloom. That’s half the US, really. Huge chunks of the midwest and west.
The shock wouldn’t even be instant. Let’s say we invented an extremely low cost source of energy tomorrow. How long would it take to ramp it up to levels that could replace all the others? How long would it take to turn the car fleet over? How long before factories could switch over to the cheaper energy?
In fact, it might even cause a short-term shortage of employment, because we’d still have to run the old infrastructure for some time, while there would be an explosion of demand for workers for all the new businesses that are suddenly viable.
mswas: I wasn’t trying to ignore your argument - I just don’t understand what your argument is. You have suggested the mechanisms by which your dsytopia appears, other than that the change would happen ‘instantly’ and therefore it’s somehow different than any other price shock that has ever happened. But that’s not an argument - it’s an assertion. You haven’t exactly shown your work.
I thnk the closest thing to a plausible negative scenario is that the countries that sustain themselves with oil production would be hurt very badly, which could lead to civil unrest in those countries. And this is possibly true, but it’s equally possible that unlimited energy could turn those countries into areas of massive opportunity. What could you do in the middle east with unlimited access to water and energy? In fact, the existence of oil wealth has been enabling dictators throughout that region. Perhaps this would be the best thing that could happen to them. They’d also lose the money to fund terrorism, military buildups, and nuclear programs.
Free energy would be a huge boon to mankind.
Sam Stone All of your examples were of a technology that disrupted one industry or a portion of one industry. We’re talking about a technology that disrupts MANY industries, particularly industries that include the ONLY industry that some countries have.
Tell me exactly how this would benefit the people of Saudi Arabia?
Your concept of what might be better for the people in the long run ignores the impact it has in the short term, which is what I am talking about. Yes, eventually the Benighted Utopia Generator would be great for society but initially it would throw our civilization into chaos.
You keep asserting that. You also say I’ve only mentioned things that disrupted one industry. But the collapse in cost of computing power impacted almost every industry.
You also claim that this is different because it would happen ‘instantly’. Only it wouldn’t. There’s huge inertia in the world economy. Before new goods can be created that take advantage of all this free energy, the factories with new processes have to be built. Before everyone can take advantage of it, it has to be distributed across the world economy. Before we can switch to new free-energy vehicles, we have to justify the cost against the residual value of the vehicles we already have (are you going to scrap your $40,000 Lexus to save $5,000 in gas?)
In addition, as industries switched away from petroleum fuels, the price would come down for the industries still using it. This would slow the rate of transfer to the new energy sources.
The U.S. spends about 8% of its GDP on energy. That’s a lot, but it’s not so much that the country would rapidly scrap its entire manufacturing base to take advantage of an 8% savings. The change would still be relatively gradual.
Again - the price of oil dropped in half in one year between 1985 and 1986. It did not have a negative effect on employment. You want to claim that if it happened even faster it would have, but since all the evidence we have suggests that the economy adapts to price shocks without this taking place, I think the burden of proof is on you to provide evidence other than what you think is a logical outcome.
The same Saudi Arabia that with in the last few years used threats of terrorism against Britain to get one of it’s royals out of hot water?
The average Joes there deserve some relief aid till something can be worked out for another economy base, but good riddens to rest of that nasty evil mess.